CENTERPOINT ENERGY INC's gross profit margin for the third quarter of its fiscal year 2016 is essentially unchanged when compared to the same period a year ago. Sales and net income have grown, and although the growth in revenues has outpaced the average competitor within the industry, the net income growth has not. CENTERPOINT ENERGY INC has weak liquidity. Currently, the Quick Ratio is 0.74 which shows a lack of ability to cover short-term cash needs. The company's liquidity has increased from the same period last year.

During the same period, stockholders' equity ("net worth") has decreased by 14.44% from the same quarter last year. Overall, the key liquidity measurements indicate that the company is in a position in which financial difficulties could develop in the future.

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Income Statement

Q3 FY16

Q3 FY15

Net Sales ($mil)

1889.0

1630.0

EBITDA ($mil)

608.0

533.0

EBIT ($mil)

284.0

265.0

Net Income ($mil)

179.0

-391.0

Balance Sheet

Q3 FY16

Q3 FY15

Cash & Equiv. ($mil)

1084.0

1053.0

Total Assets ($mil)

21286.0

21778.0

Total Debt ($mil)

8551.0

8649.0

Equity ($mil)

3472.0

4058.0

Profitability

Q3 FY16

Q3 FY15

Gross Profit Margin

32.19

32.7

EBITDA Margin

32.18

32.69

Operating Margin

15.03

16.26

Sales Turnover

0.34

0.37

Return on Assets

-0.83

-0.03

Return on Equity

-5.12

-0.17

Debt

Q3 FY16

Q3 FY15

Current Ratio

1.05

0.75

Debt/Capital

0.71

0.68

Interest Expense

108.0

115.0

Interest Coverage

2.63

2.3

Share Data

Q3 FY16

Q3 FY15

Shares outstanding (mil)

430.68

430.26

Div / share

0.26

0.25

EPS

0.41

-0.91

Book value / share

8.06

9.43

Institutional Own %

n/a

n/a

Avg Daily Volume

3414887.0

4567593.0

Valuation

HOLD. The current P/E ratio is negative, which has no meaningful value in the assessment of premium or discount valuation, it simply displays that the company has negative earnings. For additional comparison, its price-to-book ratio of 2.97 indicates valuation on par with the S&P 500 average of 2.81 and a premium versus the industry average of 2.16. The price-to-sales ratio is well below both the S&P 500 average and the industry average, indicating a discount. After reviewing these and other key valuation criteria, CENTERPOINT ENERGY INC proves to trade at a premium to investment alternatives within the industry.

Price/Earnings

1

2

3

4

5

premium

discount

Price/Cash Flow

1

2

3

4

5

premium

discount

CNP NM

Peers 19.27

CNP 5.74

Peers 7.85

Neutral. The absence of a valid P/E ratio happens when a stock can not be valued on the basis of a negative stream of earnings.

CNP's P/E is negative making this valuation measure meaningless.

Discount. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

CNP is trading at a significant discount to its peers.

Price/Projected Earnings

1

2

3

4

5

premium

discount

Price toEarnings/Growth

1

2

3

4

5

premium

discount

CNP 19.50

Peers 17.00

CNP NA

Peers 1.41

Premium. A higher price-to-projected earnings ratio than its peers can signify a more expensive stock or higher future growth expectations.